Goodbye to another retail chain: it closes stores in the U.S. and it's almost bankrupt

The retail landscape remains very complicated for many chains that were very popular for years. The combination of multiple factors has created a very critical situation for several companies in the United States. Now, a well-known craft-made footwear brand is facing the massive closure of its stores and possible bankruptcy.

Freebird, founded in 2009 in Denver and specializing in handcrafted boots, once had 20 locations in the United States. However, it has closed 14 of them and is at risk of disappearing completely. Its recent history reflects the difficulties faced by many brands that bet on niche products in a saturated and ever-changing market.

The decline of an iconic brand

Freebird, known for its emphasis on individuality and craftsmanship, managed to build a loyal customer base thanks to its unique designs. Inspired by the idea of freedom and originality, its motto was that every pair of boots should reflect the personality of the wearer. For years, this approach was successful, but the current context has put the company against the ropes.

Despite that initial success, the economic situation and the retail sector in general have become unsustainable, reveals The Sun. According to consultant Doug Charboneau, the company entered a "severe liquidity crisis" after being sued for a debt of $15.4 million. Currently, the company owes $6 million to a Mexican manufacturer that supplied 85% of its footwear, but that supplier has ceased operations.

In an attempt to survive, Freebird has already started the closure process and has left its headquarters in Colorado. As of today, only two stores remain open and without guaranteed supply, which could accelerate further closures. Meanwhile, the company is trying to sell its remaining inventory, but sales are final and they do not accept returns.

General context: an industry in crisis

Freebird's case is not isolated. In the United States, it is estimated that about 15,000 stores will close this year due to the combination of inflation, high interest rates, changes in consumption, and competition from e-commerce. Experts predict that up to 45,000 physical stores could disappear in the next five years.

Major brands have already announced significant closures; for example, Foot Locker plans to eliminate up to 400 locations by 2026. Other chains like Tuesday Morning and Mitchell Gold + Bob Williams filed for bankruptcy in 2023. Bed Bath & Beyond also closed all its physical stores and now operates only online.

The bankruptcy process allows companies to renegotiate their debts and sell assets in an attempt to survive. However, in this case, Freebird seems to be very close to total liquidation. If it doesn't manage to complete a sale with a buyer, it will likely disappear from the market.